Pretoria — The National Credit Regulator (NCR) has urged consumers not to take on unnecessary debt.
"The National Credit Regulator would like to caution consumers about taking unnecessary debt during these trying times. We would like to reiterate our advice to consumers on how to attain financial well-being and in this regard, we recommend that consumers should scale down on unnecessary and luxury expenditures and to live within their means," said the NCR's Education and Communication Manager, Mpho Ramapala.
The credit regulator's advice comes as Statistics South Africa (Stats SA) on Tuesday announced that the South African economy has moved into a recession following a 0.7% contraction in the Gross Domestic Product (GDP) in the first quarter of 2017. This followed a 0.3% contraction in the fourth quarter of 2016.
The NCR, which is an agency of the Department of Trade and Industry, said the announcement indicates a gloomy picture for consumers.
It also advised consumers to continuously assess their financial position in order to make realistic financial decisions.
"Consumers who are debt stressed should not despair and should communicate with their credit providers for solutions into their situations. Over-indebted consumers can also seek advice from registered debt counsellors or alternative dispute resolution agents," said Ramapala.
Meanwhile, the credit regulator reminded credit providers to lend responsibly to consumers in compliance with the affordability assessment provisions of the National Credit Act.
For additional information, as well as a comprehensive list of registered entities such as credit providers, debt counsellors and alternative dispute resolution agents, consumers can visit the NCR's website on: www.ncr.org.za or contact the NCR on 0860 627 627 and email@example.com.
The NCR is responsible for the regulation of the South African credit industry.
On Thursday, Cabinet called on all sectors of society to work together to bring about inclusive growth.
"As a matter of urgency, Cabinet calls on business, labour and the broader society to partner with government to intensify our growth programme and improve confidence so as to arrest the decline and set the economy on a higher trajectory to achieve inclusive economic growth," Communications Minister Ayanda Dlodlo said at a post Cabinet media briefing in Cape Town.
Earlier this week, National Treasury announced that Finance Minister Malusi Gigaba will meet with business leaders in a bid to formulate strategies to counter economic recession and achieve inclusive growth.